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32 Cards in this Set
- Front
- Back
What are OTC stocks and provide examples.
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-OTC stocks are those that cannot meet NASDAQ listing standards,
-Quoted in "display facilities" EX: 1. Corp. bonds not listed on exchange 2. Municipal bonds 3. U.S. Gov't and agency debt 4. Money Market 5. Many bank and insurance comp. issues 6. ADRs |
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Are Mutual Funds traded?
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No. they are sold as NEW issues OTC, but do not trade
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What are the names of the OTC Equity Markets?
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-OTCBB
-Pink Sheets |
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Where are NASDAQ issues reported and when?
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Reported on NETWORK C TAPE by the 'sell side'
-Within 30 seconds of execution |
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Who regulates the OTC equities market?
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FINRA
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How many Levels of the NASDAQ are there and describe them.
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2 levels.
Level 1: summary of market intended for use by registred reps Level 2: lists all market makers and thier quotes (trader's terminal) |
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What does the NASDAQ SINGLEBOOK provide?
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-incorporates SuperMontage system that allows for the automated execution of NASDAQ trades, along with a central limit order
-SuperMontage - the ability to aggregate orders from all market participants and display them in one place ---transparancy |
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what are the types of NASDAQ securities?
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Global Market and Capital market
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what is the MPID?
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MPID = market participant ID
the market participant that enders the order in the single book -orders can round or odd (not just round like NYSE) |
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What is NSDQ MPID?
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Anonymous quote orders
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What happens if the display size is reduced to less than 1 round lot?
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= <100
2 Options: 1. Reserve Size: if decremented to "0" a reserve quote will be provided the encompases at lease 100 shares 2. Automatic Quote Refresh: if sise is decremented to "0" the market maker's quote will eb automatically renewed ata price &/0r size specified by parket maker ---is no size or price specified, AQR will renew for 100 shares at $.25 lower for a bid; or $.25 higher for a ask |
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what is the maximum order size for NASDAQ AND what orders does the system accept or not accept?
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max order size = 999,999
accepts: Market, limit and marketable limit orders (ones placed inside market prices) NOT accept: Stop orders |
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What is OATS and what does it do?
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OATS = Order Audit Trail Systems - OATS
-allows the electronic capture of ORDER INFORMATION for NASDAQ equitities -the reporting member must record in OATS -details any order modification, cancellation or execution -rules applies to all FINRA members -Info used to MATCH order details to trade execution that results via the Automated Confirmation of Trade System |
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What is ACT?
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-ACT = Automated confirmation Transaction Service
-proves reporting of LAST SALE INFORMATION on all Equity and equity-related issues (including convert. bonds) traded OTC -TRADES in NASDAQ, Third Market, OTCBB, or Pink Sheet issues must be reported w/in 30 sec. |
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What is TRF? and what does it do?
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ACT/TRF = Trade reporting facility. (operates as part of ACT platform
-NASDAQ TRF: reports completed trades of NASDAQ issues -NYSE TRF: reports completed trades of NYSE issues occurring OTC btw 2 Third Market Makers |
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What facility reports for OTCBB & Pink Sheets?
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ORF = over the counter reporting facility
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What Facility reports for NASDAQ & NYSE issues the occur on ECNs and ATSs? (alternative trading systems?)
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ADF/TRACS (trade reporting and comparison service). NOT. NYSE/NASDAQ TRF
- |
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What are Dark Pools?
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-allows institutions to buy/sell very large blocks w/o displaying their orders in the ADF or in a display system
-operated by larger Broker dealers -avoids problem that could occur if the very large order were displayed. because it could move market. |
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Define Firm Quote
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means the dealer will honor the quote for the states size. if no states size, it defaults to 100
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Unfirm Quote
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subject to negotiation
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Bids wanted
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dealer wanting to sell a position and is looking for a buyer
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offer wanted
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dealer wanting to buy a position and is looking for a seller
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subject quote
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-quote is subject to confirmation
-quote is approx price and can be changed |
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nominal quote
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dealer's guess at current price, but hes's not willing to trade at the quote
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workout quote
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approx quote - dealer has to work out exact price at which he'll trade
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define arbitrage
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simultaneosly buying and selling short same security with different market makers to lock in a temporary price differential
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Trading ahead of Research
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if firm's research will be issuing a report on a company that is liekly to impact the market price of theat stock, the firm's market making desk can not change its inventory before the research comes out
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Trade Shredding
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splitting a larger order into multiple smaller ones inorder to get more money from the multiple trade commissions. -not allowed
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Trading pools
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investors group together and "trade" stock to move up prices without actually changing ownership of stock
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wash trades
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buying and selling to creat the "appearance" of a trade
-ie. "painting the tape"/ "prearranged trade" |
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Marking the open/close
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falsely reporting trades at open/close in order to affect the opening/closing price
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What are the NASDAQ hours?
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9:30 ET- 4:30 ET
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